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CHARLES LANDREY ON WAL-MART

June 6, 2012

DISCLAIMER:  I am not a Wal-Mart fan.  Originally, the look and feel of the shopping experience kept me away. Then rumblings from vendors of business practices not to be emulated or encouraged reinforced my opinion.  But it was “Nickeled and Dimed” and its story of attitude and treatment towards employees that moved me to commit to singularly supporting its main competitor and a “home town” business rather than ever contribute even a dollar to the support the Wal-Mart practice I view as practice of profit over principles.  I simply cannot place the value of a “deal” over the value good business ethics. So I boycott the place.

Yes, I know, that’s business.  Yes, even today I remain a bit of a Pollyanna about values and ethics in the business world, and so I still believe one can make money without sacrificing the “soul” of the seller and the buyer.  And yes, I know, that the spin at least, touts a new Wal-Mart philosophy– one that recognized the error of its ways (or the pain of business lost) and initiated a renaissance within their organization.  It included an initiative to make them “hip”; a PR campaign to dispel the rumors of poor treatment of vendors and employees; and the implementation of a practice of routinely doing select item cost comparisons between its #1 competitor and Wal-Mart to point out to a naïve public that Walmart is more cost effective.  But still, I hold to my commitment to boycott.

And so, of course you can imagine the glee with which I read about their recent Shareholders Meeting.  

Entertainment included Celine Dion, Justin Timberlake, Zac Brown, Taylor Swift, Victoria Matlock and Juanes…a little something for everyone and some pretty incredible fees and production costs, including talent riders.  Yes, they all do it to some degree, and since I am often on the delivery side of this practice with other corporations, I had best not be too critical so I will leave it to the reader to form their own conclusions on that one.

“The Curse of Convenience

But it did remind me of something I stumbled across when reading the ART OF CITY-MAKING by Charles Landry.  Landry uses the big four supermarkets of Britain one of which is Wal-Mart, to demonstrate how their practices hurt cities…draining life out of the streets, cleansing a city of its diversity, and are “space eaters”.   He points out that looking at their activities through a broader food miles and sustainability perspective, they are pretty inefficient.  They use a wealth of expertise and resources at their fingertips to lobby, to change minds, and to get their way.  They exert immense power and “in sum, they pull the wool over our eyes so we do not understand the underlying dynamics of their operations and their impact on real life.”

And then he supports his comments with factoids (most date back to 2006 for Wal-Mart) as follows:

Not only do the big four including Walmart control 75% of food retailing in Britain, consumers spend  about 13% of net income in supermarkets.  But, a research experiment showed consumers spent the SAME AMOUNT whether they shopped at a big box or frequented and supported local stores!

The PERCEPTION that the big four are good value stems from a concept referred to as KVI   (comparison of known value items).  It relies on fact that we, the consumer, know the cost of only a small number of goods and these are the very items the big four price check against their competitors and keep as low as possible… then are frequently higher than local stores on other items to make up the difference.

Wal-Mart is the world’s largest retailer and the world’s largest corporation, employing 1.4 million workers worldwide and with over 1 million employees in the US, it is the largest private employer here. And yet:

  • More than half of Wal-Mart US employees leave the company each year
  • Average earnings of $19,000 are well-below poverty level for average family of four
  •  There is no defined benefit pensions and still has inadequate healthcare
  •  660,000 employees  are without company-provided health insurance, forcing workers to  seek taxpayer-funded public assistance
  •  A US Congressional study found Wal-Mart costs the Am. taxpayer up to $2.5 billion in public assistance to subsidize its $10 billion in profits
  •  Wal-Mart is sued once every two hours, every day of the year and consistently list 9400 of those cases as “open”

 

But change may be coming.  Despite their early 21century “re-invention” a film you may recall entitled “Wal-Mart:  The High Price of Low Cost” seems to disprove the PR campaign.   It focused on and reflected those same old issues….”conditions of workers, the company’s intimidation of employees, its power over supply chains and the culture of fear it induces”.  In addition, it showed with clarity what the coming of Wal-Mart to local towns does to the community…with great footage of deserted towns and main streets all across America – much of which can be linked to the arrival Wal-Mart.   Slowly, we are seeing Wal-Mart building proposals carefully reviewed and debated  before permits are approved, or as in Chicago and Vancouver, denied.

We can only hope it is the beginning of a new trend.

 

 

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